Jordan Blum, editorial director, Hart Energy: We are here at Hart Energy's DUG Appalachia Conference in Pittsburgh. I'm joined by Dennis Degner, the president and CEO of Range Resources. Thank you so much for being here. Now this is the 20th anniversary just in October of unlocking the Marcellus Shale, now the biggest gas play in the country. Obviously, that was done by Range, so I wanted to get your take on just Range's role in that history and kind of the evolution since.
Dennis Degner, president and CEO, Range Resources: Well, the history of Range really dates back to many decades and having an Appalachia presence and much of it was through shallow production, through more conventional horizons that we could all probably name off the top of our head. But really what we quickly started to see is that with unconventional development in plays like the Barnett Shale, there was a real opportunity underneath our feet as we were drilling deeper to test some other new horizons, if you will. And what we quickly realized is that the Marcellus Shale actually was very analogous to the Barnett. And in some ways early on, we felt like could even be better. And I think the fact that we're here 20 years later talking about it is a testament to that quality component.
JB: Very good. No, and congrats on all the achievements there. Now, obviously because of that, Range got a bit of a head start on the land rush in the industry that took place afterwards. I want to get your take on all the M&A that's been happening in the industry. Some peers in Appalachia obviously, but Range hasn't had to be very active there. Can I get your take on why and why you're not in a rush to do so going forward?
DD: Yeah. I think it goes back to maybe the first question and that is the Renz [well]. And I think when you start to think about the quality of the Marcellus and what we were able to put together from an acreage position and inventory quality early on, we really feel like we are in the core-of-the-core when it comes to the Marcellus Shale.
And so it allowed us to put together early on around a half a million net acreage position here in southwest Pennsylvania. We also have acreage in the northern part of the state as well. And what's well understood and appreciated is our inventory life is significant and the quality is good as well. So what it allows us the ability to do is focus on more efficient development of our current asset base, realizing the value of that as we harvest those wells and not have to be involved with M&A when we have this kind of large contiguous acreage position with this kind of quality.
JB: Very good. So yeah, maybe you could tap into the Utica oil window if you wanted to. It's just not practical for now.
DD: Well, we do have around 200,000 net acres in Northwest Pennsylvania that is on trend with the Ohio Utica development that you're seeing today. So we're closely watching those well results and who knows when it might find its way into the activity program decades down the road.
JB: Very good. Well also just lastly, wanted to get your take on what you're most excited about in terms of technology trends and efficiencies, but also what could be on the way in terms of potential infrastructure permitting reform, et cetera.
DD: Well, I think on the efficiencies and technology front, I think it really comes back to long horizontal development improvements over the course of time. I think you saw that last year with Range where we saw around a 40% improvement in our overall drilling efficiencies. That came on the back of technology process improvement and just working really closely in lockstep with our service partners.
And so I think the future is going to be more of that. You're going to see more technology come into our space. You're going to see new equipment and processes that are going to allow us to, instead of averaging 10,000 to 12,000 feet in horizontal lengths, maybe it's 15,000 and greater. As an example, last year we drilled four laterals that were 20,000 feet in length.
So, how do you start to creep closer and closer to averaging that upper end of what we've been able to capture in a one-off scenario, if you will.
And then I think on the other side of technology, I think about really about our emissions management program. And if you were to look at over just the past five to 10 years and where we are, we're on the low end of the emissions curve. And it's competitive not only in leading when it comes to the Lower 48, but also for the global emissions curve when you look at other producing assets. And that's all on the back of LDAR [leak detection and repair] inspection processes, top-down surveys and other technologies that are going to just further enhance what we do. We commonly say as an industry, we're using best available technology, but because of our large contiguous acreage position, the quality of it and the durability of the asset base, we're able to then take this data from the LDAR inspections, as an example, and then go back to our service partners and help advance and improve what is best available technology.
JB: Very good. Well, thank you so much for being here with us in Pittsburgh. We really appreciate it. To read and watch more, please visit online at hartenergy.com.
